Regis gold mine gets green light

West Australian gold developer
Regis Resources
is likely to enter the realm of mid-tier gold producers in financial year 2013 after approving the development of the 180,000 ounce per year Garden Well gold project.

According to the company, the Garden Well development will take Regis’ total gold production to around 350,000 ounces for financial year 2013.

This is significant because mid-tier gold producers, those with more than 200,000 ounces of gold production each per year, typically see a much higher valuation than smaller producers with annual production of less than 100,000 ounces per year.

Project development at Garden Well is set to commence in July 2011 and commercial production is forecast to commence in the September quarter of 2012 , the company said on Thursday in a statement to the Australian Securities Exchange.

In its first year of production the project is expected to deliver 247,000 ounces of gold at cash costs less than $400 an ounce.

Gold futures are currently trading above $US1,500 an ounce in New York.

Average gold production each year is expected to be around 180,000 ounces, with a mine life of around 9 years.

Total operational costs per ounce of gold over the life of the mine is expected to be $631 an ounce.